BIGGEST Ethereum Opportunity (Why These Altcoins Will Explode)

demand for ethereum has never been higher from nfts to d5 there's a seemingly never-ending amount of use cases and applications for the ethereum decentralized network the dark side to ethereum though is that its flaws are also on full display right now this creates opportunity for competitor chains and platforms to take a crack at taking eth down however competitors aren't the only projects that are getting a boost from the issues on the eth network today we're going to take a look at ethereum layer 2 solutions and why this is one of the top areas you should be looking at for gains let's get it bit swap is the hottest new way to trade tokens calling all the top decentralized exchanges biswap gets you the very best price and value for your trades bitswap is changing the game try it now at bitswapdex.io welcome to bitboy crypto the largest crypto channel in all the interwebs my name is ben everyday on this channel i show you how to make money in cryptocurrency if you like money and crypto please make sure to subscribe to the channel for your chance to win one full bitcoin details down below in the video description also if you enjoy ethereum videos make sure to smash the like button so youtube knows to show this video to more people today we're going to be taking a look at ethereum layer 2 solutions and why you are definitely going to want to keep an eye on projects in this space so let's start with what layer 2 solutions are you may have heard of the term scalability but you may not know exactly what it means in terms of cryptocurrency and blockchain think about it in terms of your local grocery store when you used to go there in person the good old days if you go to the store at 5am there's likely one person running one checkout you go pick up your pepperoni hot pockets and take them to the register you walk straight up to the register place your hot pockets on the conveyor belt and you pay done in less than a minute but now imagine that you try the same thing at about 11 a.m when you grab your hot pockets and head to the register there are four cashiers and each line has two people in it already it takes much longer for you to check out you have to choose your line based upon what the people's carts in front of you look like then you have to wait for them to go first before you finally get to check out your one minute grocery store trip turned into a 10-minute fiasco pretty big difference now imagine you're in the same store to grab hot pockets the night before thanksgiving with an impending blizzard hitting your area you walk into the store and before you even walk back to the freezer section to grab those sweet hot pockets you're met by a mob of people 12 registers all open all with at least 10 people in each line your one minute grocery store trip has turned into a two-hour nightmare oh yeah and because there are so many people you also now have to pay to get in the line this is the ethereum network as is as long as there aren't a lot of people in the store the lines move quick and transactions are pushed through rapidly however the more people that enter the network the more transactions need to go through at once and the higher these fees called gas fees become if you went into the store to buy hot pockets for 4.99 and had to pay a 100 fee just to buy them you would do what walk out of the store of course but let me ask you this have you ever been in a line at the grocery store behind a lady with seven kids two carts and a fanny pack full of cupids then like an angel of light a grocery store employee from the customer service area looks at you waves and smiles and says sir i can check you out over here no matter how long the lines are the customer service register is always a cheat code this is what you can think of in terms of a layer two solution for ethereum they scale applications on the ethereum network by handling transactions internally and off the main chain because it costs money in gases to perform any transaction on ethereum layer 2 solutions are necessary for instance blockchain gaming makes no sense without a layer 2 solution you need actions performed immediately and cheaply in games layer 2 solutions work to solve the crazy fee and scalability issues many users experience with the ethereum network there are several different types of layer two solutions out there including roll-ups state channels plasma volitium side chains and hybrid solutions so let's tackle each one and look at projects that use those solutions and i really urge you guys to pay attention here because a lot of these words will become key members of the crypto glossary understanding these words gives you a better understanding of what projects actually do which in turn can help you make wise investment decisions starting off with roll ups roll ups are pretty easy to understand because they roll up transactions into layer one and just so we're clear whenever we say layer one we specifically are referring to the actual ethereum network itself with rollups transactions occur on layer two but the data and log from the transaction rolls up into layer one through these rollups users see reduce fees and faster transactions there are two types of roll ups zero knowledge or zk roll ups and optimistic roll ups zk roll ups use what is called a validity proof the most popular project that uses zk roll ups is loopering a project we've looked at in the past the other type of roll-up is called an optimistic roll-up it uses a side chain and fraud proofs basically you have to prove your transactions real optimistic rollouts basically get the transaction right to the point of execution and then kind of leaves them hanging until they're verifiably not fraudulent optimistic rollups are considered to be a great solution because everything you can do on layer one you can do with them they're also compatible with the ethereum virtual machine or the evm and the solidity programming language that ethereum uses however due to challenges to the transactions they aren't as fast as zk roll ups one project that we love that uses these optimistic rollups is cartesi project i'm an advisor for if you've watched the projects we advise you'll definitely know they're all forward thinking projects cartesi is definitely one to watch as layer 2 solutions become more important and in the spotlight the next type of solutions are channels or state channels if you've heard of the lightning network for bitcoin it's basically the same concept a channel is open for transactions that sends off tons of transaction data at one time the gases are only paid when the channel is closed these channels could become solutions for blockchain gaming when you begin a game you would pay some type of fee they'll front run your gaming transactions and then when you're done the channel is closed the main problem with a solution though is that it takes a lot of time and money to set up and settle a channel and running one of these channels also takes a lot of supervision one of the main projects that runs channels is called raiden network and they have the raiden network token the next solution here is plasma now these are separate blockchains anchored to the main ethereum chain and operates kind of like optimistic roll-ups if you think about multi-chain ecosystems like polka dot it's easy to see how beneficial having a multi-chain setup can be it allows higher scalability and removes limits from applications it allows them to do more things however in the current form plasma chains don't really allow for complex transactions only simple ones like swaps and transfers now two of the biggest layer two solutions period omg network and polygon are plasma chain based projects next we have validium these illusions are very similar to zk rollups except the data is not stored on layer 1.

The benefits of lydium is immense with this solution up to 10 000 transactions per second can be performed but that's not all multiple valydium chains can be ran at once so the upside of transaction speed is gigantic the downside though is that it has to use special programming languages and isn't completely compatible with solidity loop ring also uses validium side chains are another solution so side chains are many block chains that run beside the main net they're independent and actually have their own consensus algorithms they're connected by a two-way bridge this is the oldest solution but does have some holds when it comes to keeping the integrity of the chain basically if you had a giant group of side chains they could collude against the main chain but the question to always consider is who would invest millions of dollars to create something that would actually hurt the original investment seems fruitless two projects using these sidechain solutions are scale and poa network now the last solution is a hybrid setup that combines any of the previously mentioned solutions one project implementing a hybrid solution is seller a binance launch pad project these projects are getting hot right now and in the future we could be looking at some moon fuel for your portfolios if you guys want a video where i give you my top layer two solution picks for gains drop me a comment down below and smash the like button that's all i got be [Music] blessed [Music] you

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